WorldCom's accounting scandal.

WorldCom (WCOM) was the second largest long distance phone company in the United States. AT&T was the largest at that time. WorldCom's growth was largely dependent of obtaining other telecommunications companies such as MCI Communications. WorldCom also possessed the Tier 1 ISP UUNET, a crucial portion of the internet backbone.
WorldCom's accounting scandal (corporate fraud) shall be analyzed and discussed as a social justice issue.

Tuesday, April 18, 2006

Mediation and Justice

Justices is a very broad word it means different things for different people by there are five main aspects in determining justice. The first one is as punishment; this is basically when people commit some wrong doing they should be severely punished for their wrongful act. The second is justice as restitution or compensation; this is to punish wrongdoing basically compensating the victim. The third is justice as fairness; this justice is more concerned with preventative measure, basically ensuring that the same injustice does not happen in the future. The fourth is justice as process, this is providing justice through a process an example of this is Canadian legal system. The last one is Justice as reconciliation; this is about punishing the criminal and providing quality punishment to the offender. The punishment should also satisfy the victim, community and offender.

In mediation it is hard to come to a common ground where justice has been served because there are many forms of justices. The mediation must realize that there are different forms of justices. In the mediation there should be one justice served where both parties feel satisfied that the right type of justice has been served to them.

Monday, April 17, 2006

Can Social Justice be mediated?

The idea of social justice is a hard concept to grasp. Most people, countries worlds or societies want to reach or achieve social justice. It is a debatable topic if social justice is actually a possible concept to achieve. The idea of having absolute and pure social justice is hard to imagine or believe. Those who believe that anywhere in the world is living in a socially just society today have a false vision. All societies have flaws. No one society is flawless. If there was an ideal utopian society it would maybe be considered socially just. Although to ask is it really possible to have a society that is flawless, simply look at how many jobs are created just because of social injustice. The majority of students in our course will come out with a job working in the social justice system, and if the society was socially just they would then not have jobs.

The process of mediation is a process that all should be educated on and aware of. It is beneficial in many and most situations, although it is important to realize that maybe mediation is not the answer or best solution in all situations. In such a big scandal such as the world com accounting scandal, mediation, is difficult to obtain, it is difficult for me to imagine mediation working 100% in this situation. There are so many people involved in the scandal, so many people who have been affected; sometimes it seems with too many people involved the mediation process is much more difficult. The executives at WorldCom scandal created a fraud that hurt and took advantage of many people, even other fellow employees who were working for the company yet unaware of the actions that the company was illegally doing. The fraudulent accounting methods that occurred made this company worth billions upon billions of illegitimate dollars. These people defiantly need to be dealt with and punished somehow with in the justice system for the action they took. Trying to mediate this process would be lengthy, and difficult. Overall I believe this sort of crime needs to be dealt with in court with a litigation process.

It is important to understand that Crime is Crime. All crimes are bad. Being on the street and robbing someone is no different then the WorldCom accounting scandal. All criminal acts are bad and unnecessary. Both these crimes are bad and hurt other people. WorldCom accounting scandal is white collar crime, yet it needs to be treated and dealt with seriously. Its not to say one group of crime is worse then another, but the WorldCom accounting scandal was defiantly a very serious and bad type of crime as it affected a large group of crime, known as a multi-individualistic crime.

Over all after the last few months within this course. I learned much more about mediation then I ever knew or thought possible. I think everybody needs to be aware and educated about mediation process. Perhaps if mediation was brought into play and action more in our justice system, agreements and satisfaction would be reached more often. It is always important to remember mediation is often suitable for many different varying situations. Mediation helps bring people to a settlement or conclusion that doesn’t have one party as priority over another party, mediation is fair as it has satisfaction as the goal of both parties. In conclusion I liked this course and found it to be worthwhile and I believe all people should be taught, educated and aware of mediation. It can simply help people live there day to day lives better.

At the beginning of the semester we were asked to blog about a topic that has created social injustices in our society. At first I did not know what social injustice was until on our topic and seeing how it has affected society, but after learning what social injustice is. It became clear to me our topic, the WorldCom scandal was suitable because of the injustices the scandal created. The WorldCom scandal has affected society because of the wrongdoing the executives of this company did to the general public, employees and investors. WorldCom has created mistrust amongst the general public, employees, and investor, because I believe that society now thinks that big corporations can not be trusted because of the previous scandals other companies have done. This is why WorldCom has created a social injustice in society.

WorldCom created a lot of damage in society due to their accounting scandal. They mislead their employees and investors by creating fraudulent accounting entries. In which they overstated their accounting entries in order to increase the companies profit and show less expense. Due to these false entries and wrong doing WorldCom filed for bankruptcy. This action of bankruptcy caused a lot of injustices to people who were related to WorldCom. Due to the selfishness of executives such as Bernie Ebbers employees of this company lost their jobs, Investors and banks lost their money. Overall WorldCom broke the faith and trust of society by being selfish. This white collar crime is was a social injustice to society because they had to suffer due to someone’s greed.

Since this was such a large scale scandal which included criminal investigation. I believe it would have been hard to mediate this case but I believe mediations should be done between the executives and the investors and the employees, when it came to compensating them. There have been many companies such as WorldCom who have created a great social injustice by cooking their books so to say. These type of companies who have created injustices need to become responsible and restore justice. This means they need to facilitate those who have been hurt by their actions and try to make things work out. This can be done by compensating money to individuals affected, provide social assistance etc. and criminal charge those who took part in the scandal. Fortunately the executives Scott Sullivan and David Myers are serving their time in jail for their wrong doing in this scandal.

Throughout this semester I learnt how important mediation is in conflicts, especially in criminal disputes. This case is has already gone through the justice system but future similar cases who are charged with white collar crime should go through the mediation process. Because the mediation process helps to understand each parties concerns and expectation and it help to settle disputes between parties, especially when it comes to negotiations between investors, employees and police.

Mediation is a hard process for two conflicting parties to go through because it involves hearing the other side and understanding the other parties needs and what’s. This often becomes difficult when the each party is fueled with anger and can only think about their needs and wants. As a mediator it is their job to break these barriers jobs and help each party to voice out their sides and come to a common ground. Being mediators is difficult because one must not have their self interest and/or personal bias shown in the conflict, if this happening it can poison the mediation process. If a person is to have their personal interests put into the mediation and only think about their interest it is called the partisan perception.

Many theories have been created to under stand group dynamics, social psychologists have created four theories on group behavior, and they are:Group features and process- This is how people behave in groups. The following are features of group relations, group beliefs and values, differentiation within the group, group norms and regulation, group decision making, leadership, and power, group polarization.In group/out group attitudes and behaviors- According to many social psychologists various cognitive processes affect intra and intergroup relations. The following are some of them, social identity theory, in-group/out-group bias, inter-group bias, out-group homogeneity.Conformity and Groupthink- When group member conform to other members beliefs, values, and suppress their own. The following are causes of groupthink, devaluation of diverse viewpoints and critical thinking, group pressure, the group is “perfect” or “always right”, contrary views are considered unique.Collective behaviors and deindividuation

These are some dynamics and reasons as to why a conflict party may react the way they do. Therefore mediators need to understand these theories and come up with strategies on how to deal with such parties in order to over come the conflict. Some of the strategies for mediators are educating, acknowledging, affirming, normalizing, asking for suggestion, inviting expression, exploring consequence, naming conflict perceptions, assumptions and behaviors, inviting response, reframing, and unexpected interventions. These are all strategies that would help mediators in their mediation.

Mediation is an essential and very useful tool when dealing with conflict. The formal courtroom process is very timely, costly, and sometimes unnecessary for resolving conflict. “In situations where agreement is possible, parties should be encouraged to settle distributive conflicts through negotiation or mediation, rather than use public institutions like the courts” (Picard, 2004).

Depending on the type of issue or conflict involved, the mediation process can be very beneficial to those involved. However, the mediation process can also be unsuitable for certain situations, namely the WorldCom scandal. Due to the type of crime and the extent to which so many different people were involved and affected, it would be impossible to resolve this conflict through mediation.

Various players within the WorldCom Corporation were involved in fraud resulting in them gaining millions of dollars. As a result of this 17,000 jobs had to be cut in order to compensate for the companies financial loss. The people involved in the scandal should be charged criminally and dealt with accordingly. A mediation would not achieve this, therefore adjudication is highly necessary.

“Justice often means different things to different people, and justice also may mean different things in different contexts” (Picard, 2004). The text discusses five different types of justice that emphasize different aspects of justice:

Justice as Punishment

Justice as Retribution or Compensation

Justice as Fairness

Justice as Process

Justice as Reconciliation

Almost every conflict can fall under one or more of the five types of justice, as some conflicts are more complicated or involve more parties than another. In the case of the WorldCom scandal, where various parties were involved and so many people were affected, more than one of the five types of justice can be applied. Justice as punishment is retributive and is based on the clam that those who have acted wrongfully should suffer the consequences of their actions. Those involved in the WorldCom scandal should definitely be dealt with in this form of justice. Although it would be impossible to impose the exact same consequences on them that were suffered by the victim’s of the scandal, they should be punished accordingly. Corporate/white collar crime has not been taken seriously by the judicial system and those who are convicted are often let off with a slap on the wrist and in rare cases minimal jail time.

Justice as retribution can also be applied in the WorldCom scandal, as thousands of people were affected. WorldCom was forced to cut 17,000 jobs and it should be held responsible for their compensation. Whether it is receiving money, a package deal, or other job opportunities WorldCom should be held accountable.

Over the past several weeks I have discussed issues surrounding the key players (executives) in the scandal as well as those affected by their actions (investors and WorldCom employees). As stated above this conflict cannot be resolved through the mediation process and should be dealt with through the court system. Corporate crime is very apparent in the business world but it is not dealt with accordingly in the judicial system. Forcing the WorldCom scandal to be dealt with by the courts will demonstrate the seriousness of corporate crime and discourage incidents like it in the future.

The authorities at WorldCom can be categorized under the ‘competing’ style of conflict. A person who is competing is pursuing his or her own demands, wants or claims at the expense of the other (Picard, 2004). With this style, conflict is seen as a win-lose situation and the will to win dominates. Those with this particular style value their own goals over relationships. It is clear that some of WorldCom’s decision makers had no interest in what the possible negative effects were and how much of an impact they would have on people’s lives. They were willing to do anything in their power to keep WorldCom on top even if it was at the expense of others. They felt that fraudulent action was the only solution and if it did not happen, the future of their multi-billion dollar company would be meager.

As well as analyzing the sources of conflict, mediators might categorize conflicts into various types or kinds. For example, conflicts can be viewed as relational, operational, or systemic. Conflicts are very complex and therefore these categories often overlap (Picard, 2004).

WorldCom’s conflict type can be associated with what is called Systemic Conflict, in that affected an entire organization, community and group. Systemic conflicts often have causes or effects that are beyond the control of individual parties (Picard, 2004). Although the authorities at WorldCom knew what they were doing when they used fraudulent accounting methods, it was almost impossible for them to perceive just how severe the negative effects of their actions would eventually be. For example, they did not know that 17,000 jobs would be cut as a result of their fraudulent activity. Such unfair and unintended consequences of authoritative action are unfortunate because it is often those who are not involved that get hit the hardest. Also, in many cases of white-collar and corporate crime, it is those of lower economic and social status who are most effected.

So many corporate scandals and acts of white-collar crime go unnoticed by both the justice system and the media and thousands of people are often affected by just one act.

WorldCom was hiding the fact that it was in financial debt and felt pressure to find a fast solution to the problem. They used fraudulent accounting methods to mask the declining financial condition by painting afalse picture of financial growth and profitability to prop up the price of WorldCom’s stock (Wikipedia, 2006). Desperate situations (especially where money is concerned) often lead people to take desperate measures. In this case, WorldCom was not in the financial position that was perceived by the public; therefore they had to find a quick way to fix their financial problems and get back on top.

Conflict Over Procedures

There were two possible ways with two very different outcomesthat WorldCom could have dealt with its financial problems: 1) Using fraudulent accounting methods to hide the declining financial situation. This is the option that WorldCom chose to take in its attempt to maintain the company’s reputation and perceived financial status. This method backfired and their efforts to bring WorldCom’s financial condition up, only made matters worse. It resulted in the company being forced to take desperate measures in order to save WorldCom’s future, not to mention the criminal action being taken. These efforts include substantial cuts in capital spending both this year and next. It will also cut 17,000 jobs by discontinuing operations, saving $900 million, the company says, and it will sell "a series of non-core businesses, including the wireless resale business, which alone will save $700 million annually. (http://www.forbes.com/home/2002/06/26/0626topnews.html).

2) Owning up to and admitting the fact that WorldCom was in financial turmoil and working on ways to overcome this. Further, reaching out to other corporations or outside sources for financial support as well as coming up with creative solutions for short and long term plans for the future of the company. This may have had a completely different outcome than the first option. They may not have been forced to cut so many jobs, WorldCom’s reputation may not have been so severely tarnished and they would not have faced criminal charges. It is hard to say whether or not this option would have helped or hindered WorldCom’s financial situation in the end but it seems like the better way in terms of reputation and its future.

WorldCom, the former second largest long distance phone company in the U.S. was accused of taking part in a multi-billion dollar accounting scandal. The company used fraudulent accounting methods to mask its declining financial condition by painting a false picture of financial growth and profitability to prop up the price of WorldCom’s stock.By the end of 2003, it was estimated that the company's total assets had been inflated by around $11 billion. The full story can be seen at the following website: http://news.bbc.co.uk/1/hi/business/2077838.stm.

When most people think of crime they think of street crimes such as robbery, murder, assault, etc., but very few people think of corporate/white collar crime as being detrimental to society. Corporate crime is less obvious and usually involves employees or professionals of a higher social class. Unfortunately, the definition of crime and the nature of criminal justice policies in society usually reflect the structures of power in that society (Wikipedia, 2006). We often do not think of corporate crime as something that hurts or effects the general population but this is not the case. While rich business men become wealthy, thousands of others are suffering or will eventually suffer. For example, in its attempt to restructure its debt WorldCom was forced to cut 17,000 jobs. This is an enormous amount of people who will be jobless due to greed and corporate scandal.

Financial and legal factors were huge contributing factors to this conflict. Ernie Ebbers along with many other powerful business men became extremely wealthy as a result of this accounting scandal. With the financial world still reeling from the collapse of Enron, and the conviction of its former auditor Andersen for obstruction of justice, world financial markets were sent into further turmoil by allegations of massive fraud at global telecom WorldCom. The illegal actions of other large corporations helped trigger WorldCom’s conflict to come into the open. Enron, a huge multi-billion dollar company was brought down the U.S. justice system in what was a rare case of criminalizing corporate crime.

Socio-economic status, class and power play a large part in many if not most corporate scandals. Ernie Ebbers, a rich, white wealthy businessman is the typical perpetrator of corporate crime. In today’s society those in power (rich, white men) are the ones committing these white collar crimes because they have the control, ability and resources to do so. It is also interesting to mention that the 17,000 jobs that were cut as a result of the WorldCom scandal are jobs of people of a lower class and socio-economic status. This imbalance of power is a reoccurring theme in the white collar crime world.

As one can see the WorldCom accounting scandal affect many people. It affected the employees at WorldCom, the executives of the companies, shareholders moreover it affected the general public. I personally believe many of these individuals were difficult to deal with especially the executives.

One of our supplementary readings was on dealing with difficult people. Dr. Robert Bramson published a book called “Coping with Difficult people”. Bramson explained that difficult people’s behavior is often learnt. Bramson developed six categories of difficult people, each category explained what and how difficult people act and react in situation. Bramson’s six categories of difficult people are the following:

The Hostile/aggressive-a) Overtly Aggressive- this person feels the need to be constantly right. They generally portray a higher sense of self confidence.b) Covertly Aggressive- These people often take sneak attacks, they try putting a person down by being sarcastic etc.The Complainer-- These people tend to complain and blame everyone else for their problem.The Silent/Unresponsive- These people feel if their quite their safer of as oppose to responding to questions. Therefore they tend to remain silent when questions are being asked.Negativist-- These people have a negative viewpoint on everything. They don’t have much trust and hope for anything.Super Agreeable- - These people are the “people pleaser” they would make commitments to make people happy but not hold up to them.The know it all expert- These people are highly productive and confident. They believe they have a higher sense authority.

I believe since their were so many people involved in this scandal, most of the executives who were charged in this scandal must have portrayed one of these personalities. These difficult people become hard to deal with but people such as mediators must know how to cope with these individual in order to over come the conflict.

Applying the principles of mediation to the case (WorldCom’s accounting scandal), social justice cannot be achieved. WorldCom’s accounting scandal has impacted a large group of people: employees, investors, other companies, international relations, etc. Criminals of individualistic crimes in North America are regarded as “enemies of the state or nation”. Therefore, corporate criminals must also be seen and treated similarly based on their criminal offenses. Corporate crimes affect a group of people— multi-individualistic crimes.

Because corporate fraud is a serious crime and mediation is only utilized when all parties are willing to participate, this case needs to be dealt in court within a legal system called litigation. Litigation is somewhat like arbitration to an extent. Litigation occurs in court while arbitration does not occur in the courts. Mediation is used when a serious infringement of the law has not been proven and the parties’ involvement is voluntary. Criminal charges are always dealt in the litigation process. In this adversarial system, all parties defend themselves and reveal factual proof. In this case “social justice” can be achieved through the litigation process (in courts) influenced by the judge’s decision(s) and/or the jurors. In this case mediation will not ensure that social justice will be achieved. In the litigation process the judge formulates a final decision.

We have seen that WorldCom had reportedly misrepresented its financial statements to an extent of around $ 4 billion. Also, it was mentioned that around 20% of workforce (many workers with families to feed) layed off. Not only do corporate crimes entail a legal disrespect, but they also affect society as a whole; therefore, it is clear why people believe that corporate crimes are worst than individualistic crimes. An interesting standard in the practice of mediation: “a sword to persuade and a shield to protect”.

The former CFO Scott Sullivan and the former controller David Myers face 65 years in prison. WorldCom's founder and former chief executive, Bernie Ebbers, says he was unaware of the accounting problems, and has not been charged.

We have also seen that dealing with difficult people requires education and experience.

Final notes:

It has been a great semester and pleasure meeting all of you.

Have a great summer everyone and thank you Janette for this wonderful and meaningful experience.

Final Blog After finishing the mediation course, I have learned that mediation can be more beneficial to certain disputes, and can worsen others. The disputes I believe to be best resolved through the mediation process are those that involve a dispute that is in need of reconciliation, for example a dispute between a mother and daughter. Mediation would be very appropriate for this dispute, as it would allow both sides to express their feelings and thoughts.

In our text, justice is described to have five different meanings. The first meaning is justice as punishment. This is based on the fact that when people have made wrongful acts, they should suffer the consequences. In relation to the WorldCom scandal the executives should be punished for what they decided to do. They should not be allowed to work for another company in a position of authority. The second meaning is justice as restitution or compensation. This meaning focuses on correcting the past injustice, and provides compensation or restitution to the victim. In regards to the WorldCom scandal, compensation should be paid to all investors for the amount of money they lost. Justice as fairness is another meaning, which the main concern is the prevention of future injustice. The WorldCom executives should not be allowed to work in position of power and control, to ensure that their scandals will not happen again. The problem with trying to resolve the dispute fairly is that there is no way we can evaluate the fairness of the result. The forth meaning is justice as a process. This meaning states that we cannot arrive at a just outcome if we do not use a fair process. In relation to the WorldCom scandal, the more fair the process is, the greater chance the result will be fair. To ensure a fair process I feel that this dispute should not be mediated and should be dealt with in a formal court trial. The final meaning is justice as reconciliation. This meaning of justice demands the infliction of an equal amount of pain and suffering on the offender as what the victim went through. In regards to the WorldCom scandal the executives should reflect on their wrong doings and publicly make a sincere apology to the victims. This apology would disclose to the public what their company did. The apology might also provide reconciliation to the victims who lost money and those who lost their jobs.

Through out these blogs, I have been most concerned with the dispute between the WorldCom executives and investors. I am aware that there are other disputes in relation to this scandal, for instance the dispute between the government and WorldCom and the dispute between WorldCom employees who were unaware of these wrong doings and the executives, but I decided to focus on the dispute between the executives and the investors. I felt this dispute was the most important, since it dealt with a larger group of people that were affected by the scandal. Also the investors can be seen as less in power than the government and WorldCom. Personally I think the dispute between the investors and the WorldCom executives should be dealt with through a formal court trail. Dealing with the dispute in court would ensure fairness to the investors and also it would provide them with a concrete settlement. Where as if this dispute were to be mediated and the executives fail to live up to the settlement promises, they investors would have to bring the dispute to court.

WorldCom Conflict and Corporate Crimes; Can Social Justice be mediated?

Throughout my learning about the mediation process, I have realized that mediation is a valuable art and science that can be used to manage an assortment of conflicts and situations. However, the more concepts I applied to the WorldCom conflict, the more I felt that in the case of WorldCom and many other corporate crimes, this type of social justice could not be mediated. I feel that adjudication a formal courtroom setting with a judge present to legally impose ground rules and decisions on the participants, is a more appropriate way of achieving justice. Because of the extent of the damage associated with the WorldCom scandal, the parties were too large for a mediation to resolve the conflict. Those responsible for the WorldCom scandal have violated the law by committing fraud. We live in a society where we believe that people who break the law should somehow pay for what they have done (i.e. retribution goal of sentencing). This was especially important because of the previously discussed extent of damage caused by the fraud for WorldCom’s employees and shareholders. Therefore it is particularly important that those responsible for the WorldCom scandal somehow pay for their fraudulent accounting practices. A judge and a formal court ruling are necessary to legally enforce this type of sanction and thus achieve social justice under these circumstances because losses were so great and those involved were too numerous. Below is a summary of mediation science concepts I have applied to the WorldCom conflict in order to reach this conclusion.

WorldCom Scandal: Can social justice be mediated?The more concepts I apply to the WorldCom conflict, the more I feel this social justice case could not be mediated. I feel that adjudication was a more appropriate way of handling the WorldCom conflict, that it, in a formal courtroom setting with a judge present to legally impose ground rules and decisions on the participants. The ground rules examined above are similar to enforced courtroom rules. I think that this conflict was too large to have a mediator enforce these ground rules. Because of the extent of the damage associated with the WorldCom scandal, the parties were too large for a mediation to resolve the conflict. Those responsible for the WorldCom scandal have violated the law by committing fraud. We live in a society where we believe that people who break the law should somehow pay for what they have done (i.e. retribution goal of sentencing). This was especially important because of the previously discussed extent of damage caused by the fraud for WorldCom’s employees and shareholders. Therefore it is particularly important that those responsible for the WorldCom scandal somehow pay for their fraudulent accounting practices. A judge and a formal court ruling are necessary to legally enforce this type of sanction and thus achieve social justice under these circumstances because losses were so great and those involved were too numerous.WorldCom Scandal: Can social justice be mediated?The more concepts I apply to the WorldCom conflict, the more I feel this social justice case could not be mediated. I feel that adjudication was a more appropriate way of handling the WorldCom conflict, that it, in a formal courtroom setting with a judge present to legally impose ground rules and decisions on the participants. The ground rules examined above are similar to enforced courtroom rules. I think that this conflict was too large to have a mediator enforce these ground rules. Because of the extent of the damage associated with the WorldCom scandal, the parties were too large for a mediation to resolve the conflict. Those responsible for the WorldCom scandal have violated the law by committing fraud. We live in a society where we believe that people who break the law should somehow pay for what they have done (i.e. retribution goal of sentencing). This was especially important because of the previously discussed extent of damage caused by the fraud for WorldCom’s employees and shareholders. Therefore it is particularly important that those responsible for the WorldCom scandal somehow pay for their fraudulent accounting practices. A judge and a formal court ruling are necessary to legally enforce this type of sanction and thus achieve social justice under these circumstances because losses were so great and those involved were too numerous.WorldCom Scandal: Can social justice be mediated?The more concepts I apply to the WorldCom conflict, the more I feel this social justice case could not be mediated. I feel that adjudication was a more appropriate way of handling the WorldCom conflict, that it, in a formal courtroom setting with a judge present to legally impose ground rules and decisions on the participants. The ground rules examined above are similar to enforced courtroom rules. I think that this conflict was too large to have a mediator enforce these ground rules. Because of the extent of the damage associated with the WorldCom scandal, the parties were too large for a mediation to resolve the conflict. Those responsible for the WorldCom scandal have violated the law by committing fraud. We live in a society where we believe that people who break the law should somehow pay for what they have done (i.e. retribution goal of sentencing). This was especially important because of the previously discussed extent of damage caused by the fraud for WorldCom’s employees and shareholders. Therefore it is particularly important that those responsible for the WorldCom scandal somehow pay for their fraudulent accounting practices. A judge and a formal court ruling are necessary to legally enforce this type of sanction and thus achieve social justice under these circumstances because losses were so great and those involved were too numerous.WorldCom Scandal: Can social justice be mediated?The more concepts I apply to the WorldCom conflict, the more I feel this social justice case could not be mediated. I feel that adjudication was a more appropriate way of handling the WorldCom conflict, that it, in a formal courtroom setting with a judge present to legally impose ground rules and decisions on the participants. The ground rules examined above are similar to enforced courtroom rules. I think that this conflict was too large to have a mediator enforce these ground rules. Because of the extent of the damage associated with the WorldCom scandal, the parties were too large for a mediation to resolve the conflict. Those responsible for the WorldCom scandal have violated the law by committing fraud. We live in a society where we believe that people who break the law should somehow pay for what they have done (i.e. retribution goal of sentencing). This was especially important because of the previously discussed extent of damage caused by the fraud for WorldCom’s employees and shareholders. Therefore it is particularly important that those responsible for the WorldCom scandal somehow pay for their fraudulent accounting practices. A judge and a formal court ruling are necessary to legally enforce this type of sanction and thus achieve social justice under these circumstances because losses were so great and those involved were too numerous.Summary

I began this blog assignment explaining why the WorldCom accounting scandal was an important social justice issue to examine. Corporate crimes like these are extremely harmful. Damage is extensive however because of the wealth and social status of the offenders, corporate and white collar crimes are often overlooked or lightly sanctioned. Critical thinking is essential for promoting change and suggesting needed improvements. Examining corporate crimes is an important part of critical criminology. (Dekeseredy et al, 2005) Critical criminologists draw our attention to the tendency for attention to be drawn to the crimes of the powerless and turn the blind eye to the crimes of the “economically privileged”. (Dekeseredy et al, 2005, p. 23) A critical criminologist would say that “regardless of whether they are officially defined as crimes, economically, socially, environmentally, and physically injurious acts committed by elites are just as, if not more, important as those committed by powerless people”. (Dekeseredy et al, 2005, p. 24) To examine this bias in the law, we must “compare those things that are illegal with similar forms of social injury that are not.” (Dekeseredy et al, 2005, p. 23)Many people put trust and money into large corporations and their representatives. In the case of the WorldCom accounting scandal, people trusted the corporation to run their business with honesty. Thus trust was broken when WorldCom lied about their ‘investments’ to inflate their value as a company causing shareholders and employees to lose money. As a group, we decided to examine corporate crimes because they are often behind the scenes. More attention needs to be brought to crimes like the WorldCom scandal because they are harmful, often overlooked and by paying more attention to crimes like these we can develop new ways of sanctioning and deterring similar incidents.Going through the fourteen questions to consider when analyzing conflict, it was not difficult to see that mediating corporate crime. I could see that there were many parties involved in the scandal; employees, shareholders and the stock market as a whole were affected by the scandal. (Picard et. al., 2004) Therefore, there would be many competing interests to deal with in mediation. (Picard et. al., 2004) Damage was extensive. Many employees and shareholders lost a lot of money and it is clear that those responsible should pay for their crimes however there was no one person responsible. Also, if the scandal were to be mediated, what and how much would those who suffered be compensated? Who would pay them? Who would decide and enforce all this to uphold justice?

In my following post, I considered lecture material and decided that it was important to examine the WorldCom scandal and other corporate crimes because conflict costs. (Watt, Lecture 2, 2006) Again, understanding how corporate crimes occur can help protect people from becoming victims of corporate crimes in the future.

The fifth lecture introduced us to the five ways in which people respond to conflict. Each of these responses is appropriate in some situations and not in others. (Watt, Lecture 5, 2006) Considering these five ways, it was apparent that litigation, appealing to higher authority, was the appropriate way to deal with the WorldCom conflict and many other large-scale corporate crimes. This was the result of my reasoning because of the large and complex nature of the scandal. As written in prior posting,

“Not only did WorldCom’s fraud affect the entire corporation, its employees and shareholders, it also damaged confidence in the technology sector and share prices in many major markets declined. Anyone with a pension ends up suffering as a result of WorldCom’s fraud. It was necessary to go to higher authority because those guilty of the accounting fraud must suffer the consequences of their actions. Higher authority is needed to enforce this by making repercussions legally binding. In this situation, the litigation would explore the extent of the damage, those who are responsible and what repercussions are appropriate for the parties in question.”

Litigation involves:

(1) An objective fact-finding process (often adversarial)(2) rules of procedure(3) An (ideally) neutral third party with authority to make a binding decision (a judge)(4) win-lose outcome(5) third party provide reasons for decision (Watt, Lecture 5, 2006)

Although litigation seems appropriate in this circumstance, there are several drawbacks. It is costly and time consuming and relationships may suffer. (Picard et. al., 2004)

In my following post, I compared positional and principled negotiation. Positional negotiation involves stating ones position and trying to persuade the opposing party to agree. (Picard et. al., 2004) This would not have worked for the WorldCom scandal because of the size of the scandal and extent of the damage. As stated, the investors and employees could not simply state their losses and demand compensation. The parties were too large. Representatives needed to be elected. The scope of the problem was too immense.

Principled negotiation may have been more appropriate:(1) Separating the people from the problem(2) Focusing on interests, not positions(3) Generating options for mutual gain and(4) Using objective criteria (Picard et. al., 2004)

However, formal authority would still be needed to enforce sanctions and restitution that would be necessary to restore justice to all those who suffered great losses because of WorldCom’s financial advisors’ lies and irresponsibility.

The following week when examining ground rules, we could see that it would be difficult to follow these ground rules if the WorldCom conflict were to be mediated. The employees and shareholders were deeply hurt and deeply frustrated that they had been deceived by WorldCom’s financial officials. It would be difficult for them to speak respectfully, not interrupt and avoid “I” statements in mediation because they are hurt and angry. (Watt, Lecture 9, 2006) Emotions make conflict worse and mediation difficult which is why I feel that the WorldCom conflict was to complex to mediate. (Watt, Lecture 9, 2006)

"We need to be aware that justice means different things to different people, and also that justice may mean different things in different contexts" (Picard, et al. 2004. p.286).

Determining what constitutes social justice and social injustice is a subjective topic which we have been exploring throughout this course. After applying mediation and negotiation tactics to "social injustices" it is my belief that a clear and concise way to deal with social injustices will never develop to fully rectify a situation. It is because of my definition of social justice that leads to this conclusion. Social injustice for me is scandals such as WorldCom, genocides such as Rwanda, and needless killings such as those in war torn countries like Afghanistan, Iraq, Africa, and other places worldwide. Injustices so large that one person can not be held accountable, an entire society must be held accountable for the wrongs that I deem social injustices.

Checks and balances which are missing in our corporate systems and laws that allow groups of individuals to defraud thousands of people and secondarily affect tens of thousands more is not a problem that can be mediated or negotiated for two reasons. 1) In cases such as WorldCom, mediation and negotiation are not possible because they are simply reactive solutions which can not possibly offer full compensation for the damage and suffering those affected still feel (usually many years later due to court process). 2) The scale at which these injustices occur is simply too large to be dealt with in a mediation or negotiation setting. To successfully mediate this situation you would have to impersonalize the proceedings by electing someone to speak on behalf of all those affected (in that case, individual’s wants and needs are sometimes pushed aside). To allow offenders to impersonalize their crimes would be to let them off easily, rather they should have to face each individual who they have defrauded (in a utopian world, where lawyers are free and court proceedings are speedy). The reactive solutions are nowhere near enough to deal with such large scale and highly complicated issues of social justice.

In so far as social justice goes, it is my contention that a proactive approach be the focus of our study rather than the reactive actions to crimes which have already been committed. That is not to say that mediation and negotiation don't have their benefits in other areas. Sometimes the proactive approach seems implausible but if we have learned anything from this course and everything surrounding this course it is that one person can make a big difference. So, by personalizing a problem and taking issue with something that you find unfair you may be by some degree affect another individual in a certain situation who will also benefit from the injustice you have stood up too. Reference

At first, I was not completely sure what social justice consisted of, how it was achieved, and what was needed for its success. Social justice is often viewed as the perfect society where everything is fair in love and war. However, although it seems unlikely that social justice can be achieved in today’s society, we can still strive to reach that goal. Through the use of mediation and negotiation, and the knowledge of how these two things can have an affect on an individual, it is highly likely that conflicts can be solved through talking rather than violence. It is still hard to determine whether or not social justice can be fully achieved but it is definitely worth a try, after all, who knows what the future will bring. Mediation and negotiation create discussions which intend to produce an agreement of some sort. A discussion is “an extended communication (often interactive) dealing with some particular topic” (Watt, 2006a). This is a useful technique because if discrepancies can be settled through conversation, then it is all worth it in the end. In the case of the WorldCom Scandal, we can take a look at the various characteristics of the people behind the fraudulent act; we can determine why they act the way that they do, and what could prevent this type of individual from following similar paths in the future. First, there are individuals who exert extraverted characteristics. They are the type of person to act first, and then think about the consequences of their actions later. This applies to the WorldCom scandal because it is clear that the money-hungry businessmen were too busy racking up the riches that they forgot to think carefully about the consequences if they were to get caught. Extraverted people usually feel deprived when they are cutoff from interactions with the outside world. They are open to and motivated by others, and enjoy a variety of change in their relationships with peers. Introverted people on the other hand, think before they act; they determine the consequences of their actions and make a choice between what is right, and what is wrong. However, this type of person usually requires time alone and they are often internally motivated; they do not rely on others to achieve their own success. They also prefer one-on-one communication with people (Watt, 2006b). I would have to say that most of the individuals involved in the scandal showed extraverted characteristics, and those who showed introverted characteristics were most likely outnumbered. With this type of knowledge, it would be easier to determine what moves a WorldCom employee might make next, thus coming one step closer to attaining social justice. It would also provide the company with stable grounds in order to prevent this incident from reoccurring. According to Boulding, there are three different types of power; power to, power over, and power with. In the case of WorldCom, I think that all three types of power could be used. Expanding on this, we can see these powers being used in a variety of different scenarios. Power to, could be used to encourage or ‘push’ others to abide by the rules and regulations that were drawn up in order to allow the secrecy of the company’s inner workings to remain. Power over, or threat power, could have been used in cases where individuals did not agree with the scams going on within the company, the leaders of the project could have threatened the career of the unwilling employee. Lastly, power with, or negotiation power, could have been used in some circumstances where individuals may have been willing to participate, but demanded other things as compensation for the possibility of losing their job, in a sense. There are also different sources of interpersonal power that could be present behind the walls of WorldCom. These powers include formal authority, referent power, contract network power, reward and penalty power, personal persuasive power, expert power, information power, and work assignment, spending authority and control of resources (Watt, 2006c). In this case, I think contract network power, reward and penalty power, and personal persuasive power could apply. Knowing this, it would be easier to distinguish the method each employee uses to get the job done. By knowing the way people work, it would also make it easier for a mediator to settle an argument because they would have a better understanding of where each person is coming from. They would be able to relate to each party by seeing things from their point of view. Another way to effectively mediate a situation in order to achieve social justice would be to discover the conflict styles. Two very intelligent people (Thomas & Kilmann, 1974) categorized the styles in a particular order. They began explaining conflict in five stages; competing, collaborating, compromising, avoiding, and finally, accommodating. This is used to assist with analyzing the complexities of a situation and for the purpose of mapping a response (Watt, 2006b). This, along with the theory of ‘conscious communication,’ can be effective tools in mediation and negotiation. Conscious communication consists of ten different levels; commitment, self-observation, honesty, going beneath the surface, separating intention from conduct, separating facts from feelings, using “I” messages, active listening, willingness to admit you do not know it all, and the willingness to admit your mistakes (Edelman & Crain, 1993).

These are things that I have learned over the past few weeks. With the knowledge of this and specializing in the art of mediation, I think that people will be more prepared to deal with conflicts and will be able to come to an agreement sooner. By settling an argument through conversation rather than violence, it will not only make the world a more peaceful place (one step at a time), but it will also reach a conclusion that is appealing to both, or all, parties. This, in turn, will create a precedent for our future and will hopefully change the way people view others.

Early on in the semester we looked at social justice in Canadian society. When looking at social justice it was seen that social justice can not be achieved. Social justice would equate a perfect society where everyone has rights and freedoms that are protected and secondly everyone can equally obtain wealth. Capitalism, which dominates the Western world, focuses on the opposite where a small amount of people obtain large amounts of wealth. The rest of the people in a capitalist society are under paid for their use of labour and skills to help create a profit for the wealthy elite. The utopian idea of social justice has been used to put into place communist leaders, however these leaders once in power abandon social justice for all and turn to totalitarianism so that the government becomes the elite.

When looking at the WorldCom scandal, the topic we chose, it can be seen that the company did a social injustice to society. WorldCom deceived its investors and future investors by reporting between 2000 and 2002 numerous accounting errors that inflated the company’s earnings when in fact WorldCom was losing money. The errors were very costly as audits showed that WorldCom’s accounting errors added up to $3.8 billon more in expenses over what was reported. This intentional accounting errors lead to WorldCom filing for bankruptcy and thousands of people losing their jobs. How is that for social justice? The working class who came to work and the company used their labour in return for under paid wages lost their jobs because the management of the company falsified the expenses the company had and made it look like they were making huge profits when they were in fact losing a lot of money. The people involved got away with pocketing the money that the company got from people investing while the hard workers in the company from all over the world got pink slips because the corporation was forced to file for bankruptcy. This white collar crime facilitated by Bernard Ebbers, the CEO of WorldCom, was the largest accounting fraud committed by a corporation. In my first post I went over how WorldCom started and how it was rapidly expanding to a global market through acquisitions. It all came crashing down when the Securities Exchange Committee investigated into earlier accusations that WorldCom was not doing their accounting properly. This kind of crime referred to as white collar crime affects everyone from the investors in the company, who lose money, to the people who work for the company, who lose their jobs.

This case is now in the past so it can not be mediated. Some sort of justice was recently handed out when Bernard Ebbers got 25 years in prison for his role in the WorldCom scandal. This however does not make up for everyone who was greatly affected by the scandal. Some companies have also received reimbursement for the money owed to them by WorldCom, but there are probably people who need the money more then these companies such as the people who lost their jobs. Social justice must first start at the personal level and then develop into the society as a whole. This will make social justice more widespread but not perfect like the theory is. At this point the people collectively seeking damages from WorldCom should get WorldCom to agree to settle their grievances through mediation. Before mediation begins the mediator must gain the trust of both parties and have them to agree to mediation. When mediation begins there are some rules that have to be followed such as speaking respectfully and also not interrupting others when they are speaking. If mediation had been used to settle the financial problems of the company the same result would probably have occurred where money would be dispersed to all the investors and anyone owed money by the company. I do not think that mediation can be used for criminal matters such as prosecuting the guilty people involved in this white collar crime. Any prison sentence does not do justice for the people who lost their jobs, but punishment should still be handed out to the criminals to deter future white collar crime from happening. The punishment would give some closure to the matter and bring society a little bit closer to social justice. Having an independent organization with power to look into white collar crime would certainly lower the amount of white collar crime committed by the wealthy elite. It is the wealthy elite who have the least to gain from social justice and so their position in society should always be under the watchful eye of the rest of society. By giving more equality to the lower class and creating social justice the wealthy elite lose their power to control the rest of society.

From this course in mediation I have learned that mediation is an effective way to deal with disputes that take up time in a judicial court. Not all disputes can be solved by mediation, but a good majority of disagreements could be and that would free up time for more cases in courts to be heard in a timelier manner. Finally, by learning from past mistakes, such as WorldCom’s major accounting errors, society can become more fair and equal by punishing the wealthy elite and also not allowing such matters to happen again. By using this knowledge of social justice on a personal basis it can be put into action for all of society.

Early on in the semester we looked at social justice in Canadian society. When looking at social justice it was seen that social justice can not be achieved. Social justice would equate a perfect society where everyone has rights and freedoms that are protected and secondly everyone can equally obtain wealth. Capitalism, which dominates the Western world, focuses on the opposite where a small amount of people obtain large amounts of wealth. The rest of the people in a capitalist society are under paid for their use of labour and skills to help create a profit for the wealthy elite. The utopian idea of social justice has been used to put into place communist leaders, however these leaders once in power abandon social justice for all and turn to totalitarianism so that the government becomes the elite.

When looking at the WorldCom scandal, the topic we chose, it can be seen that the company did a social injustice to society. WorldCom deceived its investors and future investors by reporting between 2000 and 2002 numerous accounting errors that inflated the company’s earnings when in fact WorldCom was losing money. The errors were very costly as audits showed that WorldCom’s accounting errors added up to $3.8 billon more in expenses over what was reported. This intentional accounting errors lead to WorldCom filing for bankruptcy and thousands of people losing their jobs. How is that for social justice? The working class who came to work and the company used their labour in return for under paid wages lost their jobs because the management of the company falsified the expenses the company had and made it look like they were making huge profits when they were in fact losing a lot of money. The people involved got away with pocketing the money that the company got from people investing while the hard workers in the company from all over the world got pink slips because the corporation was forced to file for bankruptcy. This white collar crime facilitated by Bernard Ebbers, the CEO of WorldCom, was the largest accounting fraud committed by a corporation. In my first post I went over how WorldCom started and how it was rapidly expanding to a global market through acquisitions. It all came crashing down when the Securities Exchange Committee investigated into earlier accusations that WorldCom was not doing their accounting properly. This kind of crime referred to as white collar crime affects everyone from the investors in the company, who lose money, to the people who work for the company, who lose their jobs.

This case is now in the past so it can not be mediated. Some sort of justice was recently handed out when Bernard Ebbers got 25 years in prison for his role in the WorldCom scandal. This however does not make up for everyone who was greatly affected by the scandal. Some companies have also received reimbursement for the money owed to them by WorldCom, but there are probably people who need the money more then these companies such as the people who lost their jobs. Social justice must first start at the personal level and then develop into the society as a whole. This will make social justice more widespread but not perfect like the theory is. At this point the people collectively seeking damages from WorldCom should get WorldCom to agree to settle their grievances through mediation. Before mediation begins the mediator must gain the trust of both parties and have them to agree to mediation. When mediation begins there are some rules that have to be followed such as speaking respectfully and also not interrupting others when they are speaking. If mediation had been used to settle the financial problems of the company the same result would probably have occurred where money would be dispersed to all the investors and anyone owed money by the company. I do not think that mediation can be used for criminal matters such as prosecuting the guilty people involved in this white collar crime. Any prison sentence does not do justice for the people who lost their jobs, but punishment should still be handed out to the criminals to deter future white collar crime from happening. The punishment would give some closure to the matter and bring society a little bit closer to social justice. Having an independent organization with power to look into white collar crime would certainly lower the amount of white collar crime committed by the wealthy elite. It is the wealthy elite who have the least to gain from social justice and so their position in society should always be under the watchful eye of the rest of society. By giving more equality to the lower class and creating social justice the wealthy elite lose their power to control the rest of society.

From this course in mediation I have learned that mediation is an effective way to deal with disputes that take up time in a judicial court. Not all disputes can be solved by mediation, but a good majority of disagreements could be and that would free up time for more cases in courts to be heard in a timelier manner. Finally, by learning from past mistakes, such as WorldCom’s major accounting errors, society can become more fair and equal by punishing the wealthy elite and also not allowing such matters to happen again. By using this knowledge of social justice on a personal basis it can be put into action for all of society.

Thursday, April 13, 2006

When I started in this class I had no idea what social justice was. I had never heard of the concept and had no idea how it was that this affected me and so many of the other people around me. This course helped me to open my eyes and see how naïve the average person is to everything around them. There are so many more factors to our lives that we cannot see or touch, and there is so much more to ourselves that we would never know abut until we learn how to analyze ourselves. As far as social justice is concerned it would be fantastic if it were possible but in all truth I just cant see it working. Social justice is a concept that depends upon perfection and would only work in a perfect society something that we have strived for for so, so very long. Our theorists and law makers, our governments and social organizations have all done there parts in a an attempt to try to socialize everyone old and young and to try to make them perfect individuals but his sort of goal is just not going to be possible now or ever. In our blogs we decided to choose the world com scandal which was a case of a large company doing what they do best and gouging prices fudging numbers and in the end like all criminals they were caught. This is a perfect example of a large scale social injustice, its an example of what the influence of a few can do to the lives of many. Bernard Ebbers in an attempt to keep his wealth and to build upon it he proceeded to start messing around with the numbers and the profits to give false projections of his companies wealth and in the end he had to file for bankruptcy because he had screwed up so badly. This white collar crime resounded throughout the whole world, World com employed people in all continents in all walks of life and with the shutdown all these people are affected. In my first post that I did with my colleague Nick Eckley we try to describe these occurrences in a more picturesque way. We said that this is but a drop in a still pond, the pond being the world will feel all the ripples that ascend off of the initial drop. The manufacturers the sales people the machinist every one with any involvement is affected. This is now in the past so the mediation efforts cannot be performed but slowly justice is being dealt out. Ebbers himself was recently given 25 years for his indiscrepencies which is a mild punishment compared to the hardship that those who have lost their jobs are going through. Also many companies are being reimbursed any lost money. Social just ice must start at a micro level with each person and then build up to a more macro level, it will start at the bottom small and insignificant but at sometime it will grow more prevalent, never perfect like the concept but more attainable. At this point the companies and people that have lost so much must know begin to pick themselves back up and if possible negotiate with what ever is left of World Com to try and get back more money and perform options two and three in our mediation process, they must focus on there interests not there positions and then generate ideas for mutual gains and not be selfish, sometimes to get something u must first give something. With proper leadership we can ensure that problems like this won’t happen again in the future. People are all afflicted by the same problems, we are all greedy and selfish but in the interest of self justice we must do our best to keep ourselves in check and keep ourselves honest and true, it starts with the individual, and that individual make up a piece of the rest of the population puzzle. If everyone can take care of their own social justice then in theory it might be attained as a whole.

Wednesday, April 05, 2006

"Final Blog"

At the beginning of the semester we were to address and explain what we believe social justice/injustices to be.From these last couple of weeks of “blogging” it has become rather evident to me that social justice will never attained, but merely we will always be striving for social justice which in my eyes is a utopian concept.Our societies will never be perfect but rather a leap or strive for perfection will be a constant attempt in our societies through advocates or organizations.The fact is social justice will never be achieved because too many social injustices occur on a daily basis.WorldCom was and I believe still is a social injustice to society for when the scandal was uncovered the ripple effect to which it triggered has resonated internationally for many years, (employers- employees-technical providers-advertisers-customers).So can social justice be achieved with this World Com Scandal?

Through all the posts in this group blog we have attempted to apply as many principles and concepts as possible to attain a sense of social justice within this issue.This white collared criminal act was one of the largest fraudulent acts ever recorded in American history, and since it is of the past it can no longer be mediated but rather focus on the present issues and attempt negotiations and solve as many of the issues as possible.Until all who were severely affected by WorldCom get some form of restitution, and the ones who committed these acts receive punishments in proportion to their crimes, social justice cannot be achieved because it is an injustice that all of the employees were now out of work (80,000 employees in 65 countries), not to mention the advertisers, equipment providers, technology companies/investors and the loss of a service to millions of consumers.Such a shady and corrupt act did so much damage internationally and made our North American Society look even inferior.Until social justice can be attained collectively as a society, social justice must be attained individually one issue at a time.I have found through several research attempts that negotiations have been made and investors and companies have been remunerated for their losses, thus the notion of social justice being attained in this scandal is headed in the right direction.Also I discovered that Bernard Ebbers (co-founder of WorldCom) received 25 years (out of the potential 85 year sentence) for his part in this crime.So social justice, one step at a time is being accomplished through acts of Principled Negotiations between WorldCom executives and their effected counterparts.Again the steps in this process include; 1.) separate people from problem, 2.) focus on interests, not positions, 3.) generate options for mutual gain and 4.) the use of objective criteria (The Art and Science of Mediation, 2005).Once this is done between all parties vs. WorldCom, solutions and agreements can be made and social justice can be achieved.As rational human beings we screw up, we all accept that, WorldCom was a very big mistake and an injustice for all who were directly affected by its repercussions but if fault is accepted and they can generate options for a mutual gain whereby the victims can be compensated, then I think this is only a positive step forward.Again if and when the offenders are punished we are again taking and additional one step forward in attaining a sense of social justice within this issue.

This is what I have taken from this assignment and course, it has allowed me to really understand the meaning of social justice and that individually through every social injustice issue we encounter, we must work to improve this problem (whatever that issue may be), in order to further step forward in making our society as just as possible one day at a time.

Friday, March 31, 2006

Bridging Differences: Managing the Interaction

Most conflicts have real potential to be collabratively mediated effectively, although there are certainly factors that limit this from being achieved in which the mediator's job is to manage these behaviours and help the parties of the conflict interact and engage more collaboratively. Negative influences that escalate conflict and decrease the effectiveness of mediation are adverse perceptions, anger, fear, suspicion, frustraion, negative assumptions and risk of loss. These "negative influences can overposwer the goodwill, respect, and human connection that might otherwise result in productive interation"(Picard). The mediator must address the negative influences and assist in reconnecting the parties of the conflict so that the mediation process can move through smoothly and productively.There are certain strageties and techniques that the mediator are trained to use to help individuals over the barriers that limit their dialogue and interaction. First and foremost, the mediator needs to build a relationship of trust with the individual. This personal connection with the mediator helps individuals shift from a negative attitude to a more collaborative one and the the mediator becomes more of a bridge between two parties rather than a referee.Strategies and techniques used to respond and transform negative influences...i) Education: In the Worldcom case, using education as a strategy would work as followed. The mediator would meet with both parties in a caucus and discussed the importance and benefits of respectful communication and interaction between the parties and how this will allow the process to move smoothly and effectively and will work in the best interest of both parties. The mediator would also educate both parties involved on the effects of non-verbal interactions in which the individuals may use without even noticing if the meditor did not point them out. Therefore, during mediation if someone from either party involved in this case becomes disruptive or rude, the mediator can recall the discuss they had previously about the benefits of beig respectful and how the actions he or she is displaying is only inhibiting his or her best interests.ii) Acknowledging: Its important that the mediator acknowledge negative behaviour rather then judge the behaviour. By recognizing and acknowledging the behaviour, it will bring the individual to a point of recognition and acceptance with the behaviour. People become irrate sometimes without even knowing until someone points it out to them.iii) Affirming: Affirming the individual's efforts, ideas or intentions, even if they came out when the individual was irrate, will generally result in the individual opening up to the mediation process. If they feel like they are a positive addition to the mediation process and they are being listened to, they will open up and accepting other's good intentions as well.iv) Normalizing: Acknowledging and telling the individual that their feelings towards a certain situation are normal, can help individuals accept their feelings and help other's understand and accept other's feelings. It's sort of like putting people in other people's shoes.v) Exploring Consequences: Inviting the parties to explore the consequences of their actions can help refocusing the discussiong more constructively. It can also help people understand that the behaviour they are commiting is inhibiting the process that they have agreed to participate in.

These strategies and techniques help the mediation process work productively for both parties. When the mediator helps individuals overcome negative influences in order to pursue a path of understanding and insight, it is in their best interest.

Thursday, March 30, 2006

Restorative JusticeRestorative justice is another word used to describe justice as reconciliation. Basically, it is finding justice through punishing the wrongdoer in an attempt to reimburse the victim for what they have lost; and eye for an eye. This can apply to the WorldCom scenario because due to the fraudulent scandal that took place within the company, the clients and consumers have suffered a loss. Not only would the clients experience a material loss but they could also be experiencing a psychological loss as well; their long-distance phone company is no longer reliable, secure, and trustworthy. This type of justice can be avoided in some cases, but at times it is necessary to put the victim’s mind at ease and to provide them with some sort of closure. According to the components of restorative justice, “crime is defined as a violation of relationships or a breach of trust” (Picard et al., 2004). This definitely applies to the WorldCom case because everyone who did not participate in the scandal experienced this breach.

Wednesday, March 29, 2006

Communication Skills

"Communication happens in a variety of ways: direct and indirect, explicit and implicit, verbal and non-verbal, rational and intuitive"(Picard).

The skill of communication is essential to a successful mediation process. The ability for a mediator to exchange his or her thoughts and feelings into meaning is necessary in order to be a good mediator. The mediator needs to be able to get the parties involved in the conflict to share their thoughts and feelings, by being an example of a good communicator.

There are responses mediators can make that will block communcation: These communication blockers leaves the parties defensiveness and resistant and inhibits them from opening up and sharing their ideas and information in the mediation process.i) Being Judgemental : In the case of the Worldcom scandal, no matter the personal feelings or maybe even connections the mediator has to the scandal, he or she cannot criticize, moralize or disagree. These three things are forms of judging individuals and if the mediator judges the worldcom executives their most likely immediate reaction will be to defend themselves. It is important that the mediator does not induce guilt in the individuals, lower their self esteem, make them feel inferior or belittled or even threatened because then the individual will become aggressive and less cooperative in the mediation process which hinders the process totally.ii) Giving Advice: The mediator in this case should never order, threaten or provide solutions to the party involved. Giving advice to any of the parties involved will make them feel as if they are unable to communicate and solve their own problems and also moves blame onto the mediator in the advice given fails. The mediator must remain neutral and impartial.iii) Minimizing: The mediator may minimize someone by name calling, reassuring, diverting or praising to manipulate. The obviously problem with minimizing the parties involved in the mediation process is that it invites a negative reaction. The mediator wants the parties to feel valued and respected in order for them to dicuss freely what really matters to them.

Instead of using any of these communication blockers, we want the mediator in the worldcom scandal to be a reflective listener. Reflective listening helps to "demonstrate interest, to help people feel understood, to ensure correct understanding, to let a speaker think about what he or she said, to encourage a speaker to explain further, to enable a person to express strong emotion, and to check out unintended meanings through nonverbal expression"(Picard). If we decide that the Worldcom scandal can be mediated we want to make sure that our mediator is enabling the process to be the most successful as it is possible. We want both parties involved to feel free to speak openly and honestly, if this were not the case, this conflict may as be debated in a court of law where they are unable to speak to this extent.

Tuesday, March 28, 2006

Convening a Mediation

Convening the process in which a convenor helps the parties of a dispute become ready and willing to use the mediation process. The also decide how and when mediation should be used in order to successful resolve the dispute. In the WorldCom scandal, a convenor would meet with all the parties involved in order to understand the conflicting issues and decide whether mediation between the executives of the WorldCom scandal and essentially the US government, in which they are in dispute with, is suitable and preferred.The convening process consists of three parts. This process begins with the "first contact." One of the executives being charged in the worldcom scandal would hypothetically contacts a convenor to explore whether or not mediation is suitable for the conflict. It would more than likely be one of executives, like Bernard Ebbers, contacting the convenor because they would feel a mediation process would give them a better chance than a US court situation. Also they would have the opportunity to have more say and be more directly involved in the process. The second part is the "intake and assessment." In this step, the convenor begins to collect the necessary information about the dispute and provides both parties with the essential information about the mediation process. In this step, the convenor and both parties assess whether mediation is an appropriate method with dealing with the dispute. The last part is the "case development and pre-mediation. The convenor works with both parties to successfully prepare them for the mediation process.The convening process is much like the mediation process in the way that the convenor approaches and addresses the process. First and foremost, the convenor must build the trust of both parties, so that they will both be willing to discuss freely the dispute at hand. Building their trust also helps the parties reflect on the situation as well which encourages a fuller and deeper understanding of the conflict. The convenor than must make sure the parties have made an informed choice to participate in the mediation process and then their job is to prepare both parties for that process.

Sunday, March 26, 2006

Bridging the differences :Managing the interactions

In Many cases what we read and learn in classes and lecures are not so easy to apply to our everyday life but in this class we learn information that can be directly applied to our lives and help us out in our lives as well. LAst week we looked at difficult people and how they affect us in our lives and interactions with them, this week we are looking at managing the interactions between the two conflicting parties. This is often very difficult because just like the conflict between the two people the people themselves are very dynmic variables that can easily swing from one side of the spectrum to the other and all the way back again with no rhyme or reason. The mediator must try to gain trust and understanding in both parties toward the mediator but also and more impoortantly not mention more dificultly the mediator must also develop all these things between the two conflicting parties so that a efficient and productive mediation and agreement can b reached. Much of the time many different fallacies occur these can include Loss aversion, Endowment effects, reactive devaluation. Loss aversion occurs when they connect more importance to whatthey may lose than what they may gain strictly to the fact that they are more worried about what the opposition may stand to gain and this makes progress difficult. Endowment effects are when someone puts more emphasis on what they own and not so much on what others own. So it has some likeness to loss aversion in that we try to keep what we have and are very reluctant to give up what we have. Reactive devaluation is simply put, the essence of stubborn human nature where we are unwiling to listen to the opposition even if it is a good situation where as if it came from a neutral party then it would be graciously received. The mediator and the parties in conflict must all take a very active role to ensure that the outcome is favourable across the board. One way that this occurs is through affirming. In affirming the mediator give s lots of positive feedback so that there is a greater chance and in many circumstances it does allow for one party to accept anothers more willingly. Often times although the mediator is there as an advisor he or she will as k for the input of those in the conflict to see if they have any suggestions as to how this situation could be made better or more productive. There are still so many more areas in mediation that i could talk about but then i'd be writing a novel, mediation is possibly one of the most useful skills that you can learn whether you are a lawyer or a clerk you will deal with conflict and learning this and tking the appropriate steps can make for a lot less headaches and more victories.

Wednesday, March 22, 2006

Getting to the Yes...

Getting to the yes part of the practice of mediation has a few specific steps and procedures that must be followed. the interests, options, standards, people , and alternatives must be identified in the mediation process In order to get to the yes part of the mediation process. In mediation cases interest is what usually provides the mediator and the parties to be involved. It is also important to remember when positions are noted through interests, it is important identify what exactly are the underlining interests. In a mediation process options are also highly important. There has to be options for both parties. The options must be meaning ful and benefit both groups. Although in regards to options it is important to realize that the options are never definite and can be changed or move in a different direction. Options can vary due to the direction of the mediation. As Harvard getting to yes says, it is important to explore many options before a final decisions. The more options that are explored the more possibilities which is best for the parties to see. As the Harvard negation process focus on. People problems need to be separated from the substantive issues. in regards to the world com accounting scandal it is very important to focus on separating the people problem from the substantive issue. Because there are so many people in the company and so many people were robbed and or affected. It is important not to focus on each person’s individual problem. It is more important especially in such a big case as this to focus on the substantive issues and coming to a conclusion. In a situation such as the world com accounting scandal getting to the Yes could take a long time. That is why it is very important in such a huge scandal such as this to stay focused on the key most important points. And try to come to a agreement or a conclusion between the parties.